X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

9559. PEOPLE OF THE STATE OF NEW YORK BY ANDREW W. CUOMO, ETC., plf-ap, v. CHARLES SCHWAB & CO., INC., def-res — Eric T. Schneiderman, Attorney General, New York (Brian A. Sutherland of counsel), for ap — Quinn Emanuel Urquhart & Sullivan, LLP, New York (Faith E. Gay of counsel), for res — Appeal from order, Supreme Court, New York County (O. Peter Sherwood, J.), entered October 31, 2011, which granted defendant’s motion to dismiss the complaint pursuant to CPLR 3211 (a)(7), deemed appeal from judgment, same court and Justice, entered April 4, 2012, dismissing the complaint, and, so considered, said judgment unanimously modified, on the law, to deny the motion as to the second and third causes of action insofar as they are based upon conduct that took place prior to September 5, 2007, and otherwise affirmed, without costs. This is an enforcement action brought by the Attorney General under the Martin Act (General Business Law art 23-A) and General Business Law §349 as well as Executive Law §63(12). The Martin Act causes of action are based on General Business Law §352-c(1)(a), which, where applicable, prohibits fraud, concealment, suppression or false pretense, and General Business Law §352-c(1)(c), which prohibits false representations or statements to induce or promote the issuance, purchase or sale of securities within or from the State. It is alleged in the complaint that defendant, Charles Schwab & Co., Inc. (Schwab), a registered securities broker-dealer, engaged in fraudulent and deceptive conduct in the sale of auction rate securities (ARS) to the investing public. The Attorney General asserts that Schwab misrepresented ARS to its customers as safe, liquid investments while concealing the fact that they were complex financial instruments with significant, inherent and increasing liquidity risks.

An explanation of the Attorney General’s claims requires a description of the ARS market, which is set forth in the complaint as follows:

 
Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.

More From ALM

With this subscription you will receive unlimited access to high quality, online, on-demand premium content from well-respected faculty in the legal industry. This is perfect for attorneys licensed in multiple jurisdictions or for attorneys that have fulfilled their CLE requirement but need to access resourceful information for their practice areas.
View Now
Our Team Account subscription service is for legal teams of four or more attorneys. Each attorney is granted unlimited access to high quality, on-demand premium content from well-respected faculty in the legal industry along with administrative access to easily manage CLE for the entire team.
View Now
Gain access to some of the most knowledgeable and experienced attorneys with our 2 bundle options! Our Compliance bundles are curated by CLE Counselors and include current legal topics and challenges within the industry. Our second option allows you to build your bundle and strategically select the content that pertains to your needs. Both options are priced the same.
View Now
November 13, 2024
New York, NY

Honoring outstanding legal achievements focused at the national level, largely around Big Law and in-house departments.


Learn More
November 14, 2024
New York, NY

Women Leaders in Consulting Awards honors the industry standouts and rising stars who are making a mark within the profession.


Learn More
November 18, 2024 - November 19, 2024
New York, NY

Join General Counsel and Senior Legal Leaders at the Premier Forum Designed For and by General Counsel from Fortune 1000 Companies


Learn More

Boutique union side labor law firm seeks an entry level attorney that can thrive in a fast paced practice that is growing at a rapid rate. E...


Apply Now ›

Our client, a highly distinguished regional law firm, is seeking to hire a Capital Markets Associate for their growing office. Candidates s...


Apply Now ›

Carlton Fields is seeking an associate to join our Hartford office with three to five years of construction litigation experience. Excellent...


Apply Now ›